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E44

Financial Markets and the Macroeconomy

Credit market heterogeneity, balance sheet (in) dependence, financial shocks

Chris Garbers and Guangling Liu
This paper presents a real business cycle model with financial frictions and two credit markets to investigate the qualitative and quantitative relevance of credit market heterogeneity. To address this line of inquiry we contrast the transmission of financial shocks in an economy where loans are...
Sep 2016
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On the Causal Links between the Stock Market and the Economy of Hong Kong

Sin-Yu Ho and Bernard Njindan Iyke
There is a bulk of literature that identifies the major economic drivers of Hong Kong’s rapid and steady economic performance over the last three decades. Of these major economic drivers identified, the performance of the stock market has received less attention. This paper examines the causal...
Mar 2016
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The effectiveness of countercyclical capital requirements and contingent convertible capital: a dual approach to macroeconomic stability

Hylton Hollander
This paper studies the effectiveness of countercyclical capital requirements and contingent con vertible capital (CoCos) in limiting financial instability, and its associated influence on the real economy. To do this, I augment both features into a standard real business cycle framework with an...
Sep 2015
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Financial Development and the Diffusion of Technologies under Uncertainty in Africa

Zivanemoyo Chinzara
Using novel measures of technology diffusion and adoption developed by Comin and Hobijn (2012), we examine the role of finance in the timing of adoption and the diffusion of thirteen sectoral technologies in 44 Sub-Saharan Africa countries. These technologies cover sectors such as agriculture,...
Oct 2014
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Credit spread variability in U.S. business cycles: The Great Moderation versus the Great Recession

Hylton Hollander and Guangling Liu
This paper establishes the prevailing financial factors that influence credit spread variability, and its impact on the U.S. business cycle over the Great Moderation and Great Recession periods. To do so, we develop a dynamic general equilibrium framework with a central role of financial...
Aug 2014
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A Portrait of Informal Sector Credit and Interest Rates in Malawi: Interpolated Monthly Time Series

Harold Ngalawa
Although informal finance forms a large part of their financial sector, nearly all low income countries exclude informal transactions in official monetary data. Usually, informal finance data are nonexistent and occasionally, they are available only from surveys that often occur at irregular...
Jul 2014
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Evolution of Monetary Policy Transmission Mechanism in Malawi: A TVP-VAR with Stochastic Volatility Approach

Chance Mwabutwa, Manoel Bittencourt and Nicola Viegi
This paper investigates the evolution of monetary transmission mechanism in Malawi between 1981 and 2010 using a time varying parameter vector autoregressive (TVP-VAR) model with stochastic volatility. We evaluate how the responses of real output and general price level to bank rate, exchange rate...
Nov 2013
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